ASW Workers Deserve The Same Support Offered to Today's Pensions Victims

July 17, 2007 12:00 AM

Commenting on today's Government statement on the funding of the Financial Assistance Scheme, and ahead of tomorrow's House of Commons votes on the Pensions Bill, Jenny Willott, MP and Member of the Work and Pensions Select Committee, said:

"Having admitted their guilt in misleading ASW workers and over 100,000 others about the security of their pensions, the Government is moving in the right direction. But their proposed settlement will not deliver pensions justice.

"The only fair pensions settlement for ASW workers, is to give them same level of support offered to today's pensions victims - this is 90% of people's pension savings.

"The Governments payments to ASW workers remove the link to inflation, they ignore widows, children's and ill-health benefits and they remove the tax free lump sum, all of which would normally apply under pensions payments. As a result, the FAS actually pays out just 60% of people's pensions, not the 80% that the Government claim.

"So when Peter Hain says he can boost the FAS to pay 90% of people's pension savings, in reality he means about 70%. What's more, the FAS is so painfully slow, it has spent twice as much to run than it has actually paid out so far. This is not a just settlement.

"Tomorrow, Parliament must ensure that everyone is treated fairly by voting for the House of Lords amendments. A lot of Labour MPs abstained from the vote last time round meaning that this fair settlement failed to get through. I hope that Labour MPs will join with Liberal Democrats and other parties tomorrow and do the right thing."


Notes to Editors:

The Government's claims that the FAS currently provides up to 80% of people's pensions. This is false. The FAS refers to 'core pension', not 'expected pension'. The details of the FAS reveal that 'core pension' takes the members actual promised pension and:

Deducts all the inflation linking

Deducts some of the revaluation that would normally apply

Takes away some of the widow's benefit

Takes away the tax free lump sum

Takes away all children's benefit

Takes away the ill-health benefits

Removes the scheme pension age and replaces it with age 65 (for men and women alike)

It then takes 60% or 80% of that figure and finally it deducts 22% tax at source

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